Care services for older people are being denied vital funding because
“under-performing” NHS hospitals are soaking up public money, a government
adviser will say.

Lord Warner claims that some failing hospitals must be closed to cut spending and pay for care of the elderly.

He also warns that watering down the Coalition’s health reforms will mean the Government does not have enough money to meet the increasing costs of social care for older people.

The health plans, which have already been diluted by the Liberal Democrats, are facing fierce resistance in the House of Lords. Critics oppose the expansion of the use of private sector providers to increase competition.

Lord Warner, a former Labour health minister, says that politicians “lack the bottle” to push through the changes. The peer was a member of Andrew Dilnot’s commission which drew up proposals for funding care as the population ages.

The commission proposed that no one would pay more than £35,000 for long-term care. Higher costs would be covered by the state, which would cost £1.7 billion a year, the panel estimated.

Ministers are considering the Dilnot proposals and are said to have concerns about meeting long-term costs. Mr Dilnot last month raised fears that the economic crisis would kill his plans because ministers would be unable to find the money required.

Lord Warner insists that the proposals are “eminently affordable, particularly with the help of NHS reform”. Ministers must “push on with that reform and free up the resources to float the good ship Dilnot,” he says.

Writing for the journal of the Association of Directors of Adult Social Services, the peer suggests that the failure to reform the health service is denying the care system the extra money it will need.

“At the heart of the NHS reform agenda is the need to reduce the resources going into an expensive and under-performing acute hospital sector which accounts for 50 per cent of NHS expenditure,” he says. “It is this factor that almost single-handedly prevents more resources going into adult social care.”

To cope with the rising costs of health care and the ageing population, the NHS must find savings of 4 per cent a year, a total sum of about £20 billion.

The Health and Social Care Bill is supposed to produce those savings by putting GPs in charge of budgets, allowing them to choose which hospital should treat their patients. Lord Warner believes the reforms do not go far enough: “The elected political class across the political spectrum lacks the bottle to call time on many unsatisfactory acute providers.”